Messaging • Last Updated 9/29/2023

Increase SMS marketing ROI with 3 actionable strategies

Looking to maximize your SMS marketing ROI? Use our tips, strategies, and resources to get started.


By Emily Bowen

sms marketing roi flow chart

Did you know SMS (text message) marketing boasts a staggering 98% open rate? If your business isn't leveraging the power of this often-overlooked channel, you're missing out on a significant avenue to connect with your customers. But simply sending out text messages isn't enough. To truly maximize your return on investment (ROI), you need smart strategies tailored to this unique platform.

As a marketer, you understand the importance of strategic, data-driven decision-making. While many businesses focus their efforts on social media, email, or content marketing, few understand how to harness the potential of SMS marketing effectively. But don't worry. We're here to shine a light on this relatively untapped resource and show you how you can incorporate it into your own marketing strategy.

Imagine the immense opportunities you could unlock by reaching nearly all your customers directly with personalized messages they are almost guaranteed to read. Think of the increase in sales and brand loyalty you could achieve with a perfectly executed SMS marketing strategy. With the right tools and techniques, you could improve your business's engagement levels and, ultimately, your bottom line.

So, how do you get there? This blog post will share three actionable strategies that will help you dramatically increase your SMS marketing ROI. Whether you're a small business owner or a seasoned marketing executive at a large corporation, these tactics will give you the tools to transform your SMS marketing strategy from good to exceptional. So, let's dive in and explore the secrets to supercharging your SMS marketing ROI.

Why should you care about SMS marketing ROI?

ROI is a critical metric in any marketing campaign, and SMS marketing is no exception. But it's more than just a number. It's a reflection of the effectiveness and efficiency of your marketing efforts.

A high ROI means your campaign reaches your customers and compels them to take action. For instance, let’s say a local restaurant used SMS marketing to send out a promotional offer. If the campaign cost $100 and generated $500 in additional sales, the ROI would be 400%. The campaign compelled customers to take advantage of their promotional offer, thereby spending more at the restaurant and increasing sales.

ROI also helps businesses measure the value they get from their marketing spend. It helps identify which campaigns are working and which ones need improvement. By tracking SMS marketing ROI, businesses can optimize their marketing strategies, allocate resources more effectively, and ultimately drive better results.

Furthermore, a high ROI from SMS marketing indicates strong customer engagement. When customers respond positively to your SMS campaigns, it shows your messages resonate with them, which can lead to increased customer loyalty and lifetime value.

Why businesses choose SMS to increase overall marketing effectiveness

SMS marketing has unique advantages that make it a powerful tool for businesses. It's direct, immediate, and personal, making it an effective channel for reaching customers and driving engagement. Below, we’ll explore what makes SMS an impactful marketing strategy.

It’s compelling

SMS marketing boasts high open rates, often as high as 98%. This number is significantly higher than other marketing channels, such as email (with an average open rate of around 20%). The reason for this difference is simple: Most people have their mobile phones with them at all times, and text messages are typically read within minutes of receipt.

Immediacy makes SMS marketing a powerful tool for businesses to connect with customers in real time. People typically respond to text messages within 90 seconds, compared to 3 days for emails. SMS can ensure your message is seen and acted upon quickly, whether you're sending a time-sensitive promotion or urgent updates.

It’s personal

With SMS marketing, you can send personalized messages to your customers. Personalizing your marketing messages makes customers more likely to open and respond to your text and can significantly improve customer engagement and conversion rates.

The personal touch in these messages stems from more than just individual customization; it's also about the inherently personal nature of text messaging itself. After all, we typically reserve texting for communicating with people we know well. Consequently, an SMS from your business enters a space often reserved for friends and family, which inherently makes it feel more personal and intimate.

Personalization in SMS marketing goes beyond just using the customer's name. It can also involve tailoring the content of the message based on the customer's preferences, behavior, and past interactions with your business. Individualized content can make your messages more relevant and valuable to customers, leading to higher engagement and conversion rates.

Furthermore, SMS marketing allows for two-way communication. Customers can reply to your messages, providing valuable feedback and insights. As a result, two-way messaging can help you better understand your customers and improve your products, services, and marketing strategies.

It’s accessible

One of the most significant advantages of SMS marketing is its high accessibility and reach. Nearly 7 billion people own cell phones, and text messaging is a built-in feature on even the most simplistic models. As a result, SMS marketing can reach a broad audience regardless of location, phone type, or internet connectivity.

The fact that people can access SMS without an internet connection—unlike other digital marketing channels like email or social media—makes it particularly effective for reaching customers in areas with poor internet connectivity.

Moreover, SMS marketing is less age- or generation-dependent than many other marketing channels. People of all ages use text messaging, making it an effective channel for reaching a diverse audience. So whether your target audience is millennials or baby boomers, SMS marketing can help you connect with them.

3 ways to increase your SMS marketing ROI

Boosting your SMS marketing ROI isn't just about sending more messages. It's about optimizing your strategy to connect with your audience more effectively.

If you're unsure where to start, one of our Messaging experts recently provided step-by-step guidance in a joint webinar titled "Don't Get Left On Read: SMS Strategies for the Savvy Marketer." The webinar highlighted best practices for launching, managing, and optimizing an SMS program and offered a deep perspective on incorporating SMS into a cross-channel strategy. Watch the webinar recording here to get the details.

In the meantime, here are three key strategies that can help you increase your SMS marketing ROI:

1. Personalize your messages

Personalization is powerful in SMS marketing. You can tailor your messages to individual customers to make your communications more relevant and engaging. Personalization could involve using the customer's name, referencing past purchases, or tailoring content based on their preferences. By making your messages more personally relevant, you can improve engagement and conversion rates, boosting your SMS marketing ROI.

2. Segment your audience

Not all customers are the same, and your SMS marketing should reflect this. Segmentation allows you to tailor your messages to different groups, ensuring that each customer receives content that is most relevant to them and gets an appropriate level of traffic. You could segment your audience based on demographics, purchase history, behavior patterns, or other factors. A more targeted approach can lead to higher engagement rates, more conversions, and, ultimately, a higher ROI.

3. Include a clear call to action

Every SMS message should include a clear and compelling call to action (CTA). Whether you're asking customers to visit your website, take advantage of a special offer, or provide feedback, ensure this message is clearly communicated. A strong CTA can drive customer engagement and conversions, increasing the effectiveness of your SMS marketing and boosting your ROI.

Whatever strategies you experiment with, remember that continued testing and optimization are the keys to a successful SMS marketing campaign. By tracking your SMS marketing ROI and using these insights to improve your strategy, you can maximize the effectiveness of your campaigns and achieve better results.

Boost your SMS marketing ROI even further with the right partner

If you’re ready to take your SMS marketing ROI to the next level, Telnyx can help.

Our SMS API provides the tools and support your business needs to implement efficient messaging campaigns and achieve better performance. Our robust, billion-scale API allows you to send and receive text messages globally, enabling you to reach a vast audience and scale your SMS marketing campaigns effectively. We also provide analytics tools that offer valuable data on your messaging campaigns. You can leverage these insights to make data-driven decisions that improve your messaging strategy and fine-tune your message content, delivery times, and targeting, maximizing the overall effectiveness of your SMS campaigns.

If you’re switching from another provider, we also offer fast, easy implementation with tools like FastPort®, which streamlines porting processes with real-time CSR validation and complete transparency via our Mission Control Portal. Finally, our free, award-winning support and competitive pricing that saves the average customer 30–50% makes Telnyx a powerful ally in enhancing your SMS marketing strategy.

Talk to a Telnyx expert to learn more about how we can help you elevate your messaging capabilities for enhanced customer engagement, more efficient communication, and a significant boost to your business growth.

Looking for more information on SMS marketing? Check out some of these other resources:

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